Barclays To Cut 5,000 Jobs In AI-Driven Efficiency Push

British banking giant Barclays has announced plans to cut about 5,000 jobs, representing roughly five per cent of its global workforce, by the end of 2026 as it intensifies efforts to improve efficiency through artificial intelligence (AI).

The planned job cuts were disclosed on Thursday alongside the bank’s third-quarter earnings report, which showed a 13 per cent increase in profit after tax, supported by strong performance in its equities business.

In its earnings presentation, Barclays said it was pursuing “organisational simplification and technology change efficiency driven by AI”.

The bank added that approximately 60 per cent of the planned job losses would affect support functions, including a reduction in the number of developers as AI tools enhance employee productivity.

Barclays’ profit after tax rose to £1.65 billion ($2.2 billion) in the third quarter, up from £1.46 billion recorded in the corresponding period of the previous year.

The bank’s Chief Executive Officer, C. S. Venkatakrishnan, highlighted the lender’s continued operational and financial progress, noting that its investment banking division recorded strong performance in the equities market.

Revenue from equities surged by 47 per cent year-on-year, while total group income increased by three per cent to £7.37 billion during the quarter.

Barclays’ shares edged higher following the release of the earnings report and the announcement of its workforce reduction plans.

However, AJ Bell Investment Director, Russ Mould, said the bank’s latest performance had fallen short of market expectations, adding that its planned share buyback had not fully addressed investors’ concerns.

“The announcement comes as the company failed to match expectations with its third-quarter performance — with the unveiling of a healthy share buyback failing to ease investors’ disappointment entirely,” Mould said.

He noted that costs had risen across the wider group, while the bank faced two significant uncertainties that could weigh on its performance.

According to Mould, the first concern was an anticipated increase in taxes on the banking sector in the United Kingdom’s forthcoming budget.

The second was a reported investigation into possible misrepresentation of risks in Barclays’ private credit portfolio.

The planned job cuts reflect the growing use of artificial intelligence by financial institutions seeking to streamline operations, reduce costs and improve employee productivity, even as concerns persist over the technology’s potential impact on employment.

AFP